Home buying and the Internet

The Internet buyer has become the “typical” home buyer over the last few years, according to the California Association of REALTORS® 2006 Internet Versus Traditional Buyer Survey.

Since 2001, the share of home buyers using the Internet as an integral part of the home-buying process has nearly doubled to 70 per cent.

While the characteristics of Internet buyers and their traditional counterparts have started to converge, important distinctions between the two segments remain. According to the association’s report, Internet buyers were younger, wealthier, better educated and more likely to be married than traditional buyers. Internet buyers also reported greater satisfaction with the home-buying process compared with traditional buyers.

“The Internet is changing the dynamics between buyers and their agents, as well as the way business is conducted throughout the real estate industry. However, while the Internet has become an important research tool for home buyers, it has only enhanced the REALTOR®’s role in the transaction,” said CAR president Vince Malta.

“Buyers continue to rely on the REALTOR® for help with interpreting the information gathered from the Internet and to guide them through the home-buying process.”

According to the survey, more than nine out of 10 Internet buyers indicated that the Internet helped them better understand the process of buying a home. Additionally, Internet buyers are accustomed to receiving more frequent communication and faster response times from their REALTORS®.

“More and more consumers have high-speed Internet access at home, enabling them to gather information on all types of products and services both quickly and easily,” said Malta. “This trend has carried over to the process of buying a home. As a result, home buyers are more informed, have a greater sense of control over the process, and hold high expectations concerning how quickly they receive information.”

Internet buyers and traditional buyers expressed significant differences in how they conducted their home-buying research. Internet buyers conducted more research at the onset of the home-buying process, while traditional buyers relied more on their agent as their source of information.

Other key findings:

• The median age of Internet buyers was 39 years compared with a median of 42 years for traditional buyers.

• More than nine out of 10 Internet buyers were married, while nearly eight of 10 traditional buyers were married.

• Seventy-three per cent of Internet buyers had at least a four-year college degree and 11 per cent completed post-graduate work. By comparison, 72 per cent of traditional buyers held a college degree and five per cent completed post-graduate work.

• Internet buyers had an annual income of US $184,900, compared with US $148,910 for traditional buyers.

• Internet buyers spent an average of 5.8 weeks considering buying a home before contacting a REALTOR®, nearly three times more than traditional home buyers, who spent two weeks in this stage of the home-buying process.

• Internet buyers spent 2.2 weeks looking for the home they ultimately purchased, compared with 7.1 weeks for traditional buyers.

• Fifty-four percent of Internet buyers said the information that they gathered from the Internet was less useful than that provided by the REALTORS®; none considered the information gathered from the Internet to be more useful than that obtained from their REALTORS®.

CAR’s 2006 Internet Versus Traditional Buyer Survey is available by logging on to www.rebs.com.

Canadian experience

While a similar study has not been conducted in Canada, similar conclusions about buyers using the Internet are evident just by looking at the use of the most popular real estate website in Canada.

mls.ca is the public website run by the Canadian Real Estate Association where all MLS® listings from every real estate board in Canada are posted for anyone to see. So if a buyer in Winnipeg is looking for a home in Winnipeg, they can visit mls.ca and see all the houses on WREB’s MLS® system. If the buyers in Winnipeg are being transferred to Calgary, they can see all the MLS® listings from Calgary.

This is part of the networking that REALTORS® across Canada do to better serve sellers (massive exposure) and buyers (the entire inventory of MLS® listings across Canada).

Does it work?

mls.ca generates almost 300-million page views of MLS® properties nationwide every month! And that’s from three-million unique visitors on the site every month! For Winnipeg alone, this means over 31-million page views a month nationally.

And another 51,000 visitors viewed 1,220,014 pages last month on the Winnipeg Board’s own website — www.winnipegrealestatenews.com.

So consumers are using the Internet. And after they narrow the search, they call a professional — a REALTOR® — to help them with one of the most important financial decisions of their lives, the buying or selling of a home.